Singapore and Brazil have signed an accord to avoid double taxation, the two countries said in a joint statement on Tuesday (May 8).

The bilateral Avoidance of Double Taxation Agreement (DTA) was signed on Monday by Singapore Foreign Minister Vivian Balakrishnan and his Brazilian counterpart Aloysio Nunes Ferreira, who is on a three-day official visit to Singapore.

The two nations have also initiated discussions on a free trade agreement between Singapore and MERCOSUR, which comprises member states Argentina, Brazil, Paraguay, and Uruguay.

They aim to launch the first round of negotiations in the third quarter of 2018.

The ministers noted the growing trade and investment co-operation between the two countries, while Mr Nunes Ferreira also welcomed Singapore’s investments in Brazil.

Singapore companies are active participants across critical sectors in Brazil, including oil and gas, infrastructure, real estate, agriculture, and transport, the joint statement said

Last year, trade in goods amounted to US$3.4 billion, making Brazil Singapore’s third largest trading partner in Latin America.

Brazil is currently Singapore’s largest source of frozen chicken, frozen beef and frozen pork.

Since 2004, bilateral trade in services has grown at a compound annual growth rate of 33.9 per cent, totalling US$1.7 billion in 2016.

During his trip, Mr Nunes Ferreira also extended an invitation on behalf of Brazil President Michel Temer for President Halimah Yacob and Prime Minister Lee Hsien Loong to visit Brazil.